China plans to implement a strict pollution tax

The Chinese State Council has unveiled a draft environmental tax law which proposes to levy taxes for air, water and noise pollution, as well as greater financial and criminal punishments for violators.According to the South China Morning Post, the legislation, announced yesterday, appears to be making good on Beijing’s promise to implement regulations that will force polluters to pay for the damage they cause.Polluters will have to pay 1.4 yuan per 4kg of suspended solids for water pollutants, 5-30 yuan per tonne for solid waste and approximately 1.2 yuan per unit for air pollutants depending on the type of pollutant.Fines for industrial noise will also be levied, dependant on the level of decibels recorded. The plans state that penalties will run on a scale of between 350 to 11,200 yuan, but do not clarify if this is a daily rate or charged over a longer timeframe.Provincial governments will have the power to raise rates according to local environmental conditions and taxes may be halved if companies emit below half the national standard stipulated for various pollutants.For many companies, the cost of complying with environmental regulations has traditionally outweighed the fines, providing little incentive to install clean technologies and giving rise to various instances of environmental damage to the landscape.Amendments to the Environmental Protection Law, which went into effect on January 1, also include provisions to bolster financial and criminal punishments for transgressors.Ma Jun, director of the Beijing-based Institute of Public and Environmental Affairs, said it would motivate companies to embrace clean technology.“It’s an issue whether the levy could be charged accurately based on the pollutants generated. It will take time to observe whether the levy will be as negotiable as pollution discharge fees,” Ma said.By Dominic Jackson